In 2022, healthcare spending in Bangladesh pushed 6.3 million people below the poverty line, with 61% of hospitalized patients experiencing financial trauma. To cope with medical expenses, many individuals resort to selling assets or taking high-interest loans. Health insurance is viewed as a critical solution to these financial risks; however, Bangladesh significantly lags behind its neighbors in health insurance coverage.
Several challenges hinder the growth of health insurance in the country. Awareness of health risk management is low, and many workers expect coverage from employers rather than opting for personal health insurance. Popular endowment policies often overshadow term health insurance, as consumers prefer plans with maturity benefits. Additionally, there is no mandatory health insurance requirement for citizens, and comprehensive policies are scarce.
Most employers do not provide health insurance, and existing policies often fall short of covering hospital expenses adequately. The lack of promotional activities by insurers and regulators further contributes to low coverage rates. Although bancassurance has emerged, many banks are hesitant to sell health insurance products.
Structural issues include the absence of a centralized medical record system and inadequate data management, complicating premium calculations for providers. The current insurance penetration in Bangladesh is only 0.5% of GDP, with life insurance even lower at 0.2%. High out-of-pocket healthcare expenditures, approximately 70%, underscore the urgent need for health insurance to alleviate financial burdens and reduce poverty linked to medical expenses.
To bolster health insurance in Bangladesh, both government and private insurers should introduce appealing plans, and promotional efforts should increase across various media channels. Introducing tax incentives, faster claims processing, and a centralized database for medical history could enhance consumer interest and participation in health insurance, helping to raise overall insurance penetration and improve public health outcomes.
